Custom framing company Framebridge bucked the Covid-19 environment of retail closures and more than doubled its store footprint in the third quarter of 2020, the company said in an earnings statement.
The company, which is headquartered in D.C. with a manufacturing facility in Richmond, Kentucky, had until recently had just two retail locations — one on 14th Street NW in D.C. and another in Bethesda.
But in the last few months it has opened three more locations, one in Brooklyn, in New York City, and two in the Atlanta area, giving it a total of five locations, according to Securities and Exchange Commission filings dated Nov. 4.
That's not to say its retail locations have not been affected by Covid, as all locations are only serving customers by appointment, with sanitizer and protective equipment provided, enhanced cleaning measures and employee health screenings, according to Frambridge's website.
The move comes after the company was acquired by Arlington holding company Graham Holdings Co. (NYSE: GHC). We wrote about that acquisition and the valuation of the company in an article here. But it also comes at a time when retail bankruptcies and store closures have hit record highs, with big retailers such as JCPenney and others closing stores across the country.
The Framebridge acquisition deal, per earlier filings, included cash and $54.3 million in deferred and contingency payments based upon Framebridge meeting certain future revenue milestones. The acquisition also included the purchase of the personal stake of Graham Holdings’ CEO Timothy O'Shaughnessy, according to SEC filings. O'Shaughnessy had been an early investor in Framebridge and served as chairman of the board before its acquisition.
Framebridge had raised about $83.2 million since its founding, and had achieved a valuation of $136.5 million in 2019, according to data from PitchBook. CEO and founder Susan Tynan was the Washington Business Journal’s CEO of the year in 2019, outlining the company’s past and its potential future — and her record-setting funding rounds as a woman leading a startup.
Graham Holdings does not break out separate financial information for Framebridge, but said in its most recent filings that as an investment-stage company “Framebridge reported operating losses in the third quarter and first nine months of 2020. “
The company first opened retail locations as part of a "clicks to bricks" strategy, where purely digital operations open up retail location to gain new customers and raise their profile, in 2019. Tynan hoped at that time to have six to eight locations by the end of 2019 or early 2020.
Revenue at the holding company, which contains companies such as education services company Kaplan, Clyde's Restaurant Group, advertising analytics company SocialCode, online magazine Slate and cybersecurity workforce company CyberVista, was down nearly 3% in the third quarter to $716.9 million, from $738.8 million during the third quarter of 2019, according to filings. But profits were up substantially, with a net income of $78 million during the third quarter, up 81% from $42.9 million during the same time last year. Much of that came from a gain on marketable equity securities, which clocked in at $59.3 million, up from $17.4 million during the third quarter of 2019.
The company's stock has grown in the days since its earnings release, and now trades at about $439 per share, up from about $398 per share before the release on Nov. 4. The company hit a low of $277 per share during March, when much of the stock market tumbled amid concerns about the initial spread of Covid-19.
